2018 emerged as an emotional rollercoaster for the crypto market. With Bitcoin prices surging as high as $11,235 and bottoming out at around $3,691, it was a year to remember for investors and miners alike. What remained a constant was crypto’s relentless energy demands. In some cases, the Bitcoin network consumed nearly as much electricity as the nation of Ireland according to a study by Dutch researcher Alex de Vries. De Vries estimates that the Bitcoin network consumes “at least 2.55 gigawatts of electricity currently, and potentially 7.67 gigawatts in the future.” So the question remains, is there a renewable energy solution to offset these extensive costs in the future of crypto mining?
In order to understand Bitcoin’s energy consumption, one must understand the mining process first. In layman’s terms, Bitcoin mining can be compared to the same process as mining for traditional earth resources such as Gold. A miner can hack away at an enormous rock formation for days on end in hopes to find more than an ounce of Gold. The same could be said for Bitcoin miners in that respect. They are trying to find the exact code that will land them the precious asset. The only problem is instead of using traditional brute force like the pioneers of America did during the gold rush, this new “Bitcoin rush” uses our fragile power grid to do all the work. Talk about not breaking a sweat. The comparisons to the gold rush just don’t stop there. With the amount of competition to get these precious digital assets, miners need a competitive edge. With there being only 3.5 million out of 21 million Bitcoin left available for mining, each puzzle/algorithm gets harder the closer we get to this cap. This calls for miners to obtain massive amounts of energy. The more energy you obtain the closer you get to solving the bitcoin puzzle.
It is key to note that not only does mining gain assets, it also powers the whole global Bitcoin network when the miner gets these specific numbers right. Assortments of transactions get validated and the network secures even further when the process is successful.
With the surge of Bitcoin is the last few years, the popularity has increased tremendously. With word out that you can gain assets by just acquiring the most state of the art “ Bitcoin Farms”; there has been sort of a “arms race of miners scrambling to assemble ever-more sophisticated and powerful equipment to “mine” new bitcoin.” according to NBC News. What’s interesting though is that the biggest farms are not located in the United States. Two of the top leading mining companies “ Antpool” and “ F2Pool” are based in China. Whether it’s being responsible for the hardware or mining itself both companies are responsible for over 50% of the Bitcoin network. With all this power though, comes responsibility. With headlines such as “Bitcoin’s energy usage is huge — we can’t afford to ignore it” and “One Bitcoin Transaction Consumes As Much Energy As Your House Uses in a Week” the fear for the future of Bitcoin is at an all-time high. According to the Digicomist.com Bitcoin can power over 4,353,494 homes and it generates over 300 kilowatts an hour for one transaction in comparison to Visa which under 150 Kilowatts an hour with over 100,000 transactions. With this being said, it isn’t the most troubling information. According to research published in Nature Climate Change (October 2018), Bitcoin can alone push the worlds global warming above “above 2 °C within less than three decades“ This is troubling for the simple fact that China mainly uses coal energy which is the main energy source for the Bitcoin miners in the region.
With all the doom and gloom news surrounding Bitcoin mining, there is a green bit of hope. Enter Eden Geopower. Eden is a clean technology company developing innovative solutions to power the blockchain with renewable geothermal energy. Eden GeoPower aims to consume electricity on-site by targeting off-grid power consumers such as cryptocurrency mining. Future use cases for the off-grid powerplants developed will include hydrogen production via electrolysis, and powering off-grid data centers. The earth’s core is estimated to have the same temperature of the surface of the Sun (~6,000 C) and is the source of geothermal energy. Considered a renewable resource, geothermal energy is one of the only renewable energy resource capable of providing a 24/7 (baseload) energy supply. Eden’s ultimate goal is to use blockchain’s “Proof-of-Work” power demands as the perfect opportunity to build renewable energy infrastructure. This is important for cryptocurrency mining specifically, due to the 24/7 energy demands of miners.
The power infrastructure built is initially developed to be consumed for off-grid cryptocurrency mining operations, however, these facilities will last for 30+ years and can be used for emerging off-grid technologies that will benefit from baseload supplies of cheap renewable energy. This includes energy to produce hydrogen fuel cells via electrolysis and hosting off-grid data centers in the future.
So start spreading the news. The blockchain is going green, the future is indeed very bright and most importantly sustainable.
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